Indonesia to Implement Single Salary System for Civil Servants in 2026

Simplification of Compensation Structure

The Indonesian government is set to introduce a single salary system for civil servants (ASN) in 2026, as outlined in the 2026 State Budget Draft (RAPBN). This strategic move aims to create a more transparent, equitable, and streamlined compensation framework for ASN. The new system will consolidate various salary components, including basic salary, allowances, and incentives, into a single monthly payment.

Key Objectives and Expected Benefits

1. Enhanced Transparency: Simplification of the salary structure will improve budget planning and monitoring
2. Fairness and Equity: The system aims to reduce income disparities among ASN across different institutions
3. Performance Alignment: Compensation will be more closely tied to job value and performance
4. Administrative Efficiency: Simplified payroll management and reduced administrative burden

Challenges and Implementation Considerations

While the single salary system offers numerous benefits, its implementation presents several challenges. One major concern is the potential income reduction for ASN currently receiving high performance allowances. The success of this system heavily depends on the accuracy of job and performance evaluations. Moreover, the transition process requires careful planning, including the development of supporting regulations, administrative systems, and comprehensive socialization to ensure a smooth rollout.

Broader Context and Implications

The introduction of the single salary system is part of Indonesia's broader bureaucratic reform agenda, aiming to create a more professional, accountable, and service-oriented civil service. This policy is aligned with the National Long-Term Development Plan (RPJMN) as mandated by Law No. 49/2024. The implementation of this system demonstrates the government's commitment to gradual and planned bureaucratic transformation, potentially enhancing public service delivery and governance quality.